Most business owners are familiar with their store’s natural ebb and flow in volume based on predictable seasonal changes in the marketplace. In our business, volume is likely to drop during summer months, when people are wearing fewer and lighter clothes. Conversely, things will pick up again in the fall, when schools are in session, and heavier clothing is needed.
The challenge for a store owner facing a decline in business is to determine if it is a naturally occurring downturn or cause for alarm.
A downturn in business is a good time to take a serious look at your equipment and decide if it is time to upgrade. Are current machines old and outdated? Do you even have the right equipment? This is another instance where any shift in the market demographics should be taken into consideration.
For example, if households have grown in the area, families might be looking for larger-capacity equipment. What is the mix of top loaders to front loaders? What’s the ratio of washers to dryers? If the store was opened with 20- and 40-pound units, maybe this is the time to add 60- or 80-pound units. If it was originally planned with the potential to grow by installing extra gas line, troughs, and drains, it will be easy to expand the equipment mix.
While upgrading equipment is an investment, the new energy-efficient models with modern controls provide great ROI in energy savings. Some new control systems provide the ability to manage water volume, temperature, and cycle duration, and offer tailored vends. You can also remotely monitor laundry-room activity. This is another time to turn to the distributor for expert advice. He will be able to help you determine the right mix of equipment and estimate energy savings realized from installing more efficient machines.
SEEK MORE REVENUE SOURCES
Just as improving amenities can drive revenue, so can offering additional services. If the demographic information indicates a rise in per-capita income or the growth of small businesses in the market, consider incorporating a drop-off service.
The right attendant can make drop-off service a profitable joint venture. A drop-off partner can keep the machines going during slow periods, attract new customers, and provide support with upkeep and security. There are a number of different business models for drop-off services, but an independent-contractor arrangement offers the greatest flexibility without the responsibility of payroll taxes and other legal liabilities. Be sure to have a clear understanding of how the relationship will work, and document all financial and legal terms. Adding a successful drop-off service will be dependent on finding a partner who is self-motivated, entrepreneurial and good with the public.
As the store is upgraded and new services are added, be sure to publicize the efforts. If you offer free WiFi or drop-off service, place signage outside the store and in the windows to let the public know. Use mailers, conduct promotions and publish in the “penny saver.” And take advantage of the most potent marketing tool — word-of-mouth advertising.
Just as negative word will travel if the store is dirty or the attendant is rude, positive buzz will be generated if the store is clean, child-friendly, safe, and welcoming. Talk to the customers; engage them in helping make your store better. In addition to providing great insights into easy ways to improve customer satisfaction, “voice of customer” also builds relationships with the clientele, making them feel valued and invested in the business.
THE BOTTOM LINE
Turning your store around might be as simple as giving it a facelift. It is amazing what a new coat of paint, a thoroughly scrubbed floor and a little fresh wallpaper can do. This is another area where the distributor can be a great help. Ask him to evaluate the store with his experienced and impartial eye. Identify small, inexpensive ways to immediately improve the store — is the soap box dirty, are the folding tables unstable, is the change machine jammed? Recognize when it is time to invest in new windows and automatic doors. Think about new lights, tile or signage.
Remember, managing a successful business through good times and bad requires continual critical evaluation and the willingness to improve and invest. When one no longer has the interest or ability to do so, it may be time to re-evaluate staying in business. If you are no longer engaged in the industry and are reluctant to continue to invest in and improve the business, it might be time to sell to someone willing to make a commitment to the long-term success of the store.
If business continues without that commitment, the competition will simply erode the customer base by providing better service and a better experience. If the decision is to leave the business, once again turn to the distributor for advice. It is much easier and affordable to renovate and relaunch an existing store than to build a new one, so the distributor will probably know investors looking for opportunities to get into existing locations.
To read Part 1 of this story, click here.